Dear Shareholders
Ladies & Gentleman. A very Good Morning to you all.
I welcome you all to the 24th Annual Meeting of the Shareholders of
Crew B.O.S. Products Limited.
I will now proceed to share my thoughts on the Company and the macro
environment.
Since the onset of the global meltdown, we have all been expecting a
turnaround in the global economy & negative economic sentiment. It has
become a continual wait. There are definitely some signs of the global
economic recovery in certain quarters with the US economy showing signs
of growth; as against that, the EU is yet to come back on track with
the GDP still in the negative zone. The Indian Economy continues to
oscillate over policy issues. The investment climate is still a
challenge with credit availability and cost of capital adversely
impacting business.
It is time to also recognize the fact that the external climate will
continue to be uncertain. So, it will be left to each organization to
respond to these drifts and work out a business model that will help
them to be agile and responsive to changes. I am aware that the road we
have travelled has been arduous & it has been tough for a couple of
years. Having said that the decisions that we have made to wipe the
slate clean with respect to rectifying the issue that will allow all of
us to freely comprehend the postion the company finds itself in as of
now. This will also allow us to set on a path of recovery and launch a
transformation process where innovation and our ability to integrate
various disciplines will help us deliver results in the coming years.
Financial & Business review
Your Company''s gross income for the year ended 31st March, 2013 stood
at Rs. 28819.14 Lakhs, as against Rs. 43903.56 lakhs for the previous
year. The net income from operations was Rs. 26794.99 lakhs during
FY13, as against Rs. 43204.05 lakhs for the previous year.
However, an increase in the total expenditure (with increased interest
costs, finance charges, higher depreciation and staff and other costs
going up) affected net profits during the year under review. Your
company is confident of increasing its business during the current
fiscal and steps taken in the form of consolidations plans encompassing
the high adherence to world class quality standards shall contribute in
realizing its aspirations. The present year has had its share of
misfortune in the international trade and your company suffered heavily
due to non realization of debts from exports /domestic trades due to
the economic downturn in the Global economy.
It was also unfortunate that the company got caught unawares with a
situation relating to our Chief Financial Officer. He had the
organization wrongly believing into entering into certain trading
activities that were seemingly lucrative. These turned out to be
schemes that would benefit him personally and his associate companies
and as result he has fraudulently siphoned off scarce resource of the
company. It was later found out on investigation that all his
credentials as per his CV were wrongly declared. It was found that his
CA certificate was forged as well as his work experiences and
remunerations were wrongly stated. We have launched an investigation as
well as reported him to the competent law enforcement authorities. At
the same time we have immediately suspended and de alienated him from
any affairs of the company or its subsidiaries. Inspite of these
drastic setbacks we are confident that the company will be able to
recover and realize its true potential and corrective actions will pave
the path to its recovery
The fact that a number of our businesses were not doing well due to the
current economic scenario internationally, it was time to take stock of
the situation and focus on reducing expenses that were being carried to
support these non profitable businesses. Closure of these businesses
will allow us to be able to consolidate our balance business activities
over a narrower geographical area ensuring better control over the
efficiencies and therefore reduction of costs. It is clear that the
increase of expenditure to support optimistically our various
expansions have hurt the organization in a huge way. It was 1important
to stop this slide and focus on our core areas of manufacturing -
therefore enabling us to get on the path of recovery, albeit slowly. I
am confident that these decisions will enable us to move forward - by
first taking a few steps backward. The future of the leather business
looks very good and once we have re organized our operations to be
leaner and efficient, we can only then capitalize on the opportunity
India as a country and Crew BOS as a company has in the near future.
I would like to point out that in a few short years Crew BOS became the
number one leather goods exporter in India. I am confident that this
process of consolidating and then growing in a controlled manner will
put us back on the road to success.
A WAY FORWARD
Our valued customers who are great brands in the US and Europe continue
to support us and our long standing relationships will endure and allow
us to ride this difficult period. Our engagement with our customers has
always been exemplary and these relationships are what will see us
through these setbacks and put us back on a path of excellence that
have allowed us to serve our customers to our best abilities. Crew BOS
design room still continues to be the foremost design room in India and
Asia for leather goods. This excellence is now allowing us to go to
better customer and improve our margins in the future. Additionally the
Govt. of India along with the leather Council is taking several steps
to promote the industry. The problems of high prices of labour and raw
material in China are putting new opportunities in front us. A
combination of the above, I am sure, will allow us to perform well in
the future and restore the confidence that all of you have always had
in us.
A word of thanks
I also take this opportunity to thanks all the team members as well as
our valued clients who have supported us during this difficult phase.
We have done very well as a company since our inception. There is no
reason why we will not be able to achieve the same heights and more in
the near future. I thank all of you valued shareholders, bankers for
your support. We will continue to work hard to bring the company back
to excellence and take it to its true destiny.
Last but not the least I would like to apologies - very sincerely - for
the way the company has performed in the current year. It has been
tough and all of you have endured the pain along with us. Some, more
than others. The only assurance I can give you is that my team
members, co directors and I have tried our best to ride this storm with
a huge commitment every day. We will continue to do the same in the
future and I am sure we will have enough reason to cheer. Many many
thanks for your support.
Yours truly, TARUN OBEROI
Chairman